Personal contribution by workers under contract of employment

By Decree No 1387/01, amended by Decree No 1676/01, the personal contribution of workers under contract of employment having chosen the capitalization pension scheme was reduced from 11% to 5%, for the term of one year, as of June 2, 2001.

At a later date, by Decree No 2203/02, the reduction in the contribution to 5% was extended until February 28, 2003. Moreover, this Decree ordered the reestablishment of the contribution, by stages of 2 percentile points to be applicable as of March 1, July 1, and October 1, 2003, until the 11% established by Law No 24,241 was reached.

By Decree No 390/03, the reestablishment by stages of the 2 percentile points due for the months of July and October 2003, was suspended until July 1, and October 1, 2004, the figure remaining at 7%.

As the deadline of the extension was approaching, by Decree No 809/04 the government decided a new postponement of the suspension in relation to the reestablishment of the 2 percentile points, extending it until July 1, 2005 and October 1, 2005 respectively.

In accordance with the above, the percentage that applies to personal contributions by workers under contract of employment that have chosen the capitalization pension scheme, currently amounts to 7%. Nevertheless there still is a cap of A$ 4,800 on the salaries on which contributions are calculated.